Your new property purchase is only a hop, skip and a jump away!
03/08/2017 Loreen Dyer, Finance and Mortgage Adviser
Think you’ve found the perfect property? Great! But do you know what happens next?
Finding a property is only the first part of the story – there’s a lot that happens after finding your dream home or investment, so it pays to get expert advice before you sign on the dotted line.
So where should you start?
HOP . . .
The first thing you’ll want to do when you’ve found a property you’d like to purchase, is to determine if you can afford it! A mortgage broker can help you set some realistic price expectations and take into consideration your existing savings, borrowing capacity and ongoing financial commitments to help you work out if the property in question is appropriate for you.
Once you’ve had the all clear and received pre-approval for a mortgage, the next person you should get in touch with is a legal adviser.
Your legal adviser will be responsible for checking the details of the contract. They’ll ensure it contains nothing detrimental to the purchase or intended use of the property, and you’ll be able to discuss and negotiate any special conditions you may require in the contract. Imagine if you bought a property and assumed you’d be able to renovate, then discovered after you’d settled that there are heritage restrictions around what you can and can’t do. Disaster! A legal adviser can help you identify these issues before it’s too late.
If you’re satisfied after having investigated the contract and received expert advice , it’s time to seal the deal. Once everything is signed, discuss any conditions you may have with your solicitor. This can include ensuring your finance is approved by the due date or any work that needs to be done by the seller.
Leading up to your settlement, remember to prepare everything for the big day with the help of your solicitor. Whether it’s signing bank loan documentation, checking up on moving arrangements, or your solicitor keeping transfer documents in order; preparation is crucial!
Property settlement is the process of a seller passing their ownership onto a buyer. It’s an official transaction usually conducted between your legal and financial representatives and those of the seller. The seller (also known as a vendor) sets the settlement date in the contract of sale and this is normally 30 to 90 days after the deposit is paid and the contract is signed. It’s the responsibility of the buyer – in this case, you! – to ensure they can pay the balance of the sale price on this settlement date.
HOP . . . SKIP . . .
You’ve signed the paperwork and have a settlement date locked in, now what?!
Your lender will usually recommend you take out building and contents insurance, effective from the date the seller signs the contract. This is to safeguard their interest in the property, as well as your own.
During settlement, all outgoings are adjusted between you and the seller. The seller is responsible for rates up to and including the day of settlement; you are then responsible for these from the day after settlement. You will also be required to pay stamp duty on the sale. Typically, a conveyancer will help you settle these costs and make sure each party only pays for the share of bills that applies to them during the period in which they’ve had ownership of the property. This includes council rates, water rates etc. You can find more information on this via the State Revenue Office website.
Arrange your final inspection
During the week before you move in, you are entitled to inspect the property at any reasonable time as long as you arrange an inspection with an agent. When it’s handover time, the seller must leave you the property in the same condition as when it was sold. Check all the items listed in the contract are there and in the right condition.
Your legal practitioner will send you a plan of the land in which you’ll be able to check all the measurements and boundaries corresponding with the Certificate of Title. If everything looks normal, send confirmation; on the other hand if there’s any discrepancies, alert your legal practitioner immediately. You’d hate to lose a corner of your backyard that you’re entitled to, so now’s the time to be pedantic and ensure you get what you’re paying for. Also remember to provide documents and other information promptly when requested, as delays can be costly.
HOP . . . SKIP . . . JUMP!
Settlement date has arrived, but what does that mean?
Collect the keys
If everything has progressed smoothly, your solicitor or bank will hand over the money to the seller on the settlement date, in exchange for the transfer documents to the property. These documents may also include release of mortgage documents, and anything else that is needed for you to obtain clear title to the property. And you know what ‘clear title to the property’ means? The keys are yours for the taking!
Crack open the champagne, now it’s time to celebrate! Finally, the property is yours to enjoy. Your solicitor or bank will register the transfer into your name shortly after you move in and they will attend to finalising any outstanding matters.
As you can see there’s a lot to think of when purchasing a property, but thankfully The Hopkins Group is here to help! We have extensive experience in helping people not only find a property that’s right for them, but also with all the nitty gritty details that happen next. From seasoned property investors through to first time home buyers, we can help anyone on their house purchase journey. Our team of professional advisers can hold your hand through all the stages including financing, property selection and ultimately purchase! If you’d like to learn more, contact an adviser today.
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Over the last few months it’s been difficult to ignore articles discussing Labor’s controversial plans to scale back negative gearing for investors who buy existing property and halving the capital gains tax (CGT) discount. Michael Williams takes us through these proposed changes and how they could affect investors.
Pets in your rental property – how the rules are changing
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With a slew of changes set to shake up the Victorian Residential Tenancies Act over the next year, Property Portfolio Manager Tannaya Jessop explores the implications of one of the changes making landlords and their agents the most nervous – the new rules around tenants and their pets.
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When it comes to property investment, there are many myths and expectations – but how do these match up with reality as an investor?